20% dip in sales at kirana stores in Bengaluru: study

Neighbourhood kirana stores that don’t entertain cards saw a 20% dip in business in the week after demonetization, a study has found. However, the impact has been more severe in Mumbai, where such stores registered a 27% dip in the same period.TNN | November 19, 2016, 10:01 IST

BENGALURU: Neighbourhood kirana stores that don’t entertain cards saw a 20% dip in business in the week after demonetization, a study has found. However, the impact has been more severe in Mumbai, where such stores registered a 27% dip in the same period.

SnapBizz studied thousands of kirana stores and mini markets in six cities across the country, to examine the impact of demonetization. Their analysis is based on data collected within a week of the policy change, and was compared to data collected a month before November 8.

Smaller stores in Bengaluru have run down their stocks of soaps, shampoos, premium teas and cosmetics, contributing to increased sales in digitally-enabled stores. Cigarettes, chocolates, dry fruits, baking items, soft drinks and juice concentrates have seen a decline in sales, ranging from 7% to 13%. However, items like baby food, masalas, staples, oral care and haircare have not seen any impact on sales.

The data indicates that people are buying items from the same categories, but the quantities or sizes are smaller. “Retailers seem to be buying lesser than earlier, they are also selling more on credit,” said SnapBizz CEO Prem Kumar. "Overall, Bengaluru does not seem to have been affected as much as Mumbai, Pune or New Delhi,” he added.

Across the country, baskets containing non-food items saw a 31% decline in kirana stores and a 27% decline in mini markets. Baskets with only food items saw a 6% decline in kirana stores and a 5% increase in mini markets. The value of the average basket fell by Rs 20 in kirana stores and by Rs 7 in mini markets. Baskets are what an individual buys on a visit to kirana stores or mini markets.